[{"id":214257,"question":"_____________ represent the most widely used tool in international finance for measuring the average value of a currency relative to a number of other currencies","choices":[{"text":"Nominal exchange rates","value":"A"},{"text":"Real exchange rates","value":"B"},{"text":"Cross exchange rates","value":"C"},{"text":"Exchange rate indexes","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214256,"question":"Riskless transactions to take advantage of profit opportunities due to a price differential or a yield differtial in excess of transaction costs are called.","choices":[{"text":"Differential actions","value":"A"},{"text":"Cash transactions","value":"B"},{"text":"Arbitrage","value":"C"},{"text":"Forward transactions","value":"D"},{"value":"E"}],"correctAnswer":3},{"id":214255,"question":"The difference between bid rates and ask rates is called the","choices":[{"text":"Profit","value":"A"},{"text":"Arbitrage","value":"B"},{"text":"Spread","value":"C"},{"text":"Forward transaction","value":"D"},{"value":"E"}],"correctAnswer":3},{"id":214254,"question":"The least common type of transaction in the foreign exchanges is a.","choices":[{"text":"Forward transaction","value":"A"},{"text":"Spot transaction","value":"B"},{"text":"Swap transaction","value":"C"},{"text":"None of the above","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214253,"question":"An important feature of a___ is that the holder has the right , but not the obligation, to buy or sell currency","choices":[{"text":"Swap","value":"A"},{"text":"Foreign exchange arbitrage","value":"B"},{"text":"Foreign exchange option","value":"C"},{"text":"Futures market contract","value":"D"},{"value":"E"}],"correctAnswer":3},{"id":214252,"question":"The reduction or covering of foreign exchange risk is called.","choices":[{"text":"Hedging","value":"A"},{"text":"Speculation","value":"B"},{"text":"Intervention","value":"C"},{"text":"Arbitrage","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214251,"question":"The exchange rate is kept the same across geographically separate markets by","choices":[{"text":"Hedging","value":"A"},{"text":"Speculation","value":"B"},{"text":"Government regulation","value":"C"},{"text":"Arbitrage","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214250,"question":"Which financial instruments provide a buyer the right to purchase or sell a fixed amount of currency at a prearranged price within a few days to a coupled of years.","choices":[{"text":"Letter of credit","value":"A"},{"text":"Foreign currency option","value":"B"},{"text":"Cable transfer","value":"C"},{"text":"Bill of exchange","value":"D"},{"value":"E"}],"correctAnswer":2},{"id":214249,"question":"A depreciation of the dollar willhave its most pronounced impact on imports if the demand for imports is.","choices":[{"text":"Constant","value":"A"},{"text":"Inelastic","value":"B"},{"text":"Elastic","value":"C"},{"text":"Unitary elastic","value":"D"},{"value":"E"}],"correctAnswer":3},{"id":214248,"question":"The supply of foreign currency tends to be","choices":[{"text":"Upward sloping","value":"A"},{"text":"Down ward sloping","value":"B"},{"text":"Vertical","value":"C"},{"text":"Any of the above","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214247,"question":"The most widely traded currency in the foreign exchange market is the.","choices":[{"text":"Euro","value":"A"},{"text":"Chinses yuan","value":"B"},{"text":"British pound","value":"C"},{"text":"U.S. Dollar","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214246,"question":"Direct investment and security purchases are classified as.","choices":[{"text":"Capital account transactions","value":"A"},{"text":"Current account transactions","value":"B"},{"text":"Unilateral transfer transactions","value":"C"},{"text":"Merchandise trade transactions","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214245,"question":"The \"balance of trade\" is a record of.","choices":[{"text":"Exports and imports of financial assets","value":"A"},{"text":"The current account plus capital account","value":"B"},{"text":"The net export of goods and services","value":"C"},{"text":"The value of merchandise exports minus imports","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214244,"question":"In balance of payments accounting tourism and travel are classified in the","choices":[{"text":"Merchandise trade account","value":"A"},{"text":"Services account","value":"B"},{"text":"Unilateral transfers account","value":"C"},{"text":"Capital account","value":"D"},{"value":"E"}],"correctAnswer":2},{"id":214243,"question":"A current account surplus implies that","choices":[{"text":"The country is a net lender to the rest of the world","value":"A"},{"text":"The country is running a net capital account surplus","value":"B"},{"text":"Foreign investment in domestic securities is at very low levels","value":"C"},{"text":"All of the above","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214242,"question":"In the calculation of gross domestic product net exports are.","choices":[{"text":"The sum of merchandise trade and services","value":"A"},{"text":"The current account plus long term capital","value":"B"},{"text":"The value of merchandise exports minus imports","value":"C"},{"text":"Short term capital plus the basic balance","value":"D"},{"value":"E"}],"correctAnswer":1},{"id":214241,"question":"A nation with a current account deficit will be","choices":[{"text":"Lending more money to other nations","value":"A"},{"text":"Experiencing a surplus in exports of goods and services","value":"B"},{"text":"Reducing its indebtedness to other nations","value":"C"},{"text":"Going further into debt with other nations","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214240,"question":"A nation wishing to reduce its current account deficit would be advised to.","choices":[{"text":"Engage in more government spending.","value":"A"},{"text":"Reduce government taxes","value":"B"},{"text":"Increase private investment spending","value":"C"},{"text":"Decrease domestic consumption spending","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214239,"question":"The difference between a country's balances of payments and its balance of international indebtedness.","choices":[{"text":"Is equal of official reserve transactions","value":"A"},{"text":"Occurs because of foreign exchange fluctuations","value":"B"},{"text":"Reflects statistical discrepancies","value":"C"},{"text":"Reflects the difference between flow and stock concepts","value":"D"},{"value":"E"}],"correctAnswer":4},{"id":214238,"question":"Current account deficits are offset by","choices":[{"text":"Merchandise trade deficits","value":"A"},{"text":"Merchandise trade surpluses","value":"B"},{"text":"Capital /financial account surpluses","value":"C"},{"text":"Capital /financial account deficits","value":"D"},{"value":"E"}],"correctAnswer":3}]